February 12, 2015 / 4:28 AM / in 4 years

Sun Life fourth-quarter profit misses estimates, but set to beat 2015 targets

TORONTO (Reuters) - Canadian insurer Sun Life Financial reported a much weaker-than-expected fourth-quarter profit on Wednesday, hurt by disappointing earnings from its U.S. group life and disability operations, but said it was on track to exceed its 2015 earnings target.

A Sun Life Financial sign is seen outside of their building before their annual general meeting for shareholders in Toronto May 7, 2014. REUTERS/Mark Blinch

Net income declined to C$502 million ($398 million), or 81 Canadian cents a share, in the quarter ended Dec. 31.

But underlying net income was 59 Canadian cents a share, far below analysts expectations of 78 Canadian cents.

“It is a pretty meaningful miss, even if negative experience of this magnitude is not indicative of a run rate,” CIBC World Markets analyst Robert Sedran said in a note to clients.

“The absence of a dividend increase suggests that the better financial position was trumped by a weak underlying result,” he said.

Chief Executive Dean Connor said in a statement the fourth quarter was challenging but that Sun Life was “on track to exceed our 2015 earnings objective.”

The insurer said assets under management rose 15 percent from a year earlier to end 2014 to a record C$734.4 billion.

Reporting by Jeffrey Hodgson; Editing by Grant McCool, Chris Reese and Edwina Gibbs

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